Law 3870: Wills and Estates

Transcription

1 Law 3870: Wills and Estates Table of Contents Introduction... 3 What is a will: the fundamentals... 5 What does will: include?... 6 Testamentary character/ nature of the will... 6 Will substitutes... 7 Joint interests: joint tenancy... 8 Legislation... 9 Cases... 9 Moiny Estate (Re), 2001 BCCA Wonnacott v. Loewen, The WillMaker Age, Capacity, Intent Legislation: Wills Estates & Succession Act, s Who can make a will Cases: Legier v Poirier Sharp v Adam O Neil v Royal Trust Co Vout v Hay Ouderkirk v. Ouderkirk, [1936] S.C.R James v. Field, 2001 BCCA Brydon v. Malamas, 2008 BCSC Technical Requirements Execution, witnesses, attestation & drugstore wills Legislation: Wills Estates & Succession Act, s Indian Act, RSC 1985, c. I5, ss Cases: Yen Estate v. YenZimmerman, 2012 BCSC Neilsen Estate (Re), 2012 SKQB Ball v. Taylor (1999) 17 E.T.R. (2d) 208 (B.C.S.C.); CanLII Jones v. British Columbia (Wills Act, Public Trustee), 1983 CanLII Faulkner v. Faulkner, 60 SCR 386 (1920) Murray v Haylow RE White RE Reva Chesline v Hermiston RE Gunstan Bennett v Gray RE Forest RE Clarke Testamentary Gifts, Lapse, Abatement, Ademption, Encumbered Gifts Legislation: Wills Estates & Succession Act s 41 52, Cases: RE Taylor Re Wudel (1982), 22 Alta. L.R. (2d) 394, 13 E.T.R. 25; CanLII West Estate (Re), (BC SC) Trebett v. ArlottiWood (2004), 35 BCLR (4th) 166 C.A Milthorp v. Milthorp

2 Changes Alterations, Amendments, Revocation, Codicils & Mutual Wills General principles WESA S Powers of appointment Tassone v. Pearson 2012 BCSC Revocation by act of T Re Davies Leonard v Leonard By another Alteration Re Douglas Estate Conditional revocation Dependent relative/conditional revocation Alma Gertrude Turner (Estate Of) MacDonell v Hudson Mutual wills University of Manitoba v Montreal Trust (Sanderson Estate) Jung, Re Estate of Horace Lee Smith Estate Interpretation Cases: Laws et al v. Rabbitt et al, 2006 BCSC Murray Estate, 2007 BCSC Re Meier (Estate of), 2004 ABQB Tottrup v. Patterson et al., [1970] S.C.R Intestacy What is intestacy? WESA, Part Definition of spouse Indian Act Regime Summary ( Distribution of property on intestacy, s. 48) Young v Abercrombie Kilby v Myers Thierman Estate v Thurman Zeitler v Estate of Alfons Zeitler Challenging the Will: Undue Influence; Mental Capacity; Wills Estates & Succession Act (Wills Variation) Tribe v. Farrell, 2006 BCCA 38; 2003 BCSC Tataryn v. Tataryn Estate, [1994] 2 S.C.R Stanton v. Stanton Estate, 2008 BCCA Werbenuk v. Werbenuk Estate, 2010 BCSC Legislation: Wills Estates & Succession Act, Part 4, Div Patients Property Act and the Adult Guardianship Act Legislation: Patients Property Act [RSBC 1996] c Cases: Simons v. Simons, 2013 BCSC Lindberg v. Lindberg, 2010 BCSC Elsie Jones (Re), 2009 BCSC Powers Of Attorney Legislation: Power of Attorney Act [RSBC 1996] c

3 Cases: Goodrich v. British Columbia (Registrar of Land Titles), 2004 BCCA Egli v. Egli, 2005 BCCA Houston v. Houston, 2012 BCCA Desharnais v. Toronto Dominion Bank, 2001 BCSC Medical / Health and other decisions Legislation: Representation Agreement Act [RSBC 1996] c Health Care (Consent) and Care Facility (Admission) Act RSBC 1996, c Cases: Bentley v. Maplewood Seniors Care Society 2014 BCSC Introduction This is the stuff of life itself! Hall Origins Origins of Canadian law in English common, law, church law, and equity o Myths of time à going back to old law o Equity, fairness used by the King where the law was too strict o If common law and equity came into conflict; equity trumped o Now it is merged à but the two distinct areas of law remain interpreted by one court Statute significant today (in BC Wills, Estates and Succession Act) but old jurisprudence still relevant, still cited (forms basis for applicable principles) In some respects, legislation codifies principles originating in common law, church law, equity; parallel rules of equity also apply in this area of law Personal property Courts would decide the ability of a testator to bequeath personal property and land Ecclesiastical courts exercised jurisdiction over testamentary disposition (disposition on death) of personal property (final confession and testamentary disposition went together, hence jurisdiction) Testator (person making the last testamentary disposition ) not free to dispose of if however he likesrules apply, requiring that certain portions to be made to any wife, or child alive on death (their reasonable parts which they could enforce against the executor, the person administering the will) o Reasonable part à right to enforce it (suit) Reasonable parts fall into disuse after reign of Charles I, but we see echo of this principle in modern wills variation legislation in BC (which is not limited to personal property) o Responsibility to family vs. Freedom of the testator o IE in France they have certain portions, patrimony = obliged to provide for certain people o This has been incorporated slightly in Wills Variation Act (pre WESA, if family felt that it was unfair they could ask the court to vary the will à make a reasonable portion) o Modern version of this is incorporated into WESA Personal Property: the requirement of writing As we shall see, Formal requirements are a significant factor in modern wills legislation Originally, testamentary disposition of personal property could be oral (nuncupative), written o In WESA were these requirements to high for will makers) a large part of the discussions o WESA makes some improvements for this but less than others wanted Statute of Frauds (1677) restrict oral testaments; require three witnesses; must be made during testator s last illness and in the person s dwelling; no evidence re oral testament after six months o Some of this applied under Will Variation ie. only so much time to challenge a will 3

4 Oral testaments (unless put in writing before death) could not revoke written testament Did not apply to small estates (under a certain amount); mariners at sea and soldiers on service Restrictions on married women s ability to disposed of personal property and intestacy Husband, with knowledge of contents, had to consent (and didn t revoke it) unless property owned separately by her (ie. not marital property), or in special circumstances where she is carrying out a power conferred on her, or appointing an executor/ trix to carry out her own duties as executrix Restrictions carried over into legislation until later 19 th Century Intestacy means where a person dies without having made a testament or will, or the will is invalid Rule about how such personal property would be distributed developed by ecclesiastical courts; then codified in legislation; still incorporated in modern legislation (as we shall see!) o WESA is a compilation of many different pieces of legislation Succession to land Land and personal property differences Right to devise real property (permitted by ecclesiastical courts) abolished when King s courts took over this is because testamentary disposition of land was considered conveyance but without livery of seisin uses (enforced in equity) an attempt to get around this; when abolished, outcry leads to first Statute of Wills (now you can make a will disposing of real property, subject to rules of primogeniture also, married women, infants, persons of unsound mind, lack capacity to make will; aliens persons convicted of a crime, persons with certain disabilities also unable to make wills) Primogeniture (the heiratlaw oldest male and then hierarchy set out at p. 6) entrenched by 12 th C so long as this system endures, interferes with ability to freely (at choice of testator) dispose of land in a testament or will Primogeniture eventually done away with through legislation (although it lasts for a long time, going through some modifications) Law in Canada Legislation dealing with matters relating to wills and estates (with the exception of the Indian Act provisions discussed infra) is provincial, meaning each province has its own legislation in this area Nevertheless, modern law of succession in Canada generally uniform (with some points of distinction); common origin in English law (general principles, and cases explicating them, apply) The law of succession in Quebec is governed by the Civil Code of Quebec In BC, the WESA, which consolidated fragmented legislation in one, came in force in 2014 *Now no distinction between land and personal property Indian Act May surprise you to learn that specific provisions in the Indian Act regarding the will of an Indian to whom the Act applies (persons registered as Indians or entitled to be registered and who are ordinarily resident on reserve or designated lands) Vests all jurisdiction over matters and causes testamentary in Minister of Aboriginal Affairs and Northern Development; appeal from Minister s decision goes to Federal Court Nonstatus band members are treated as Indians for the purpose of managing/administering estates of mentally incompetent Indians and Indian children who are minors living estates ); o Living estate = estates managed by another person Living Estates Program's goal is to empower First Nation members to administer the living estates of Indian minors and mentally incompetent Indians who are ordinarily residents on a reserve Department Administrator of last resort. A departmental administrator will only be appointed as a last resort if no eligible non- departmental individual is willing and able to administer the estate. Additional matters Powers of attorney, Guardianship, health directives (representation agreements), advance directives 4

5 Frequently considered together with wills and estates Arise in same advance planning context; part of same practice area Clients seeking advance about wills often seeking advice about these matters Similar issues tend to involve older clients; money; family relationships; may raise issues of mental capacity and undue influence; planning for death Mental Capacity and undue influence Issues of mental capacity and undue influence are frequently raised in the context of wills and estates, and the related matters considered here (powers of attorney, guardianship and advance directives) Cases often involve several of these issues, enmeshed with one another See, eg, Houston v. Houston, 2012 BCCA 300 case involves second (latelife) marriage, increasingly common scenario It appears that Dr. Houston Sr., who was a gentle man and not in robust health, was caught in the middle: he wanted to protect his children s interests as the Houstons had always planned to do in their wills, but he did not want to cross his wife, who was his caretaker. She and her daughter began to take some steps in 2008 that were bound Houston v Houston Facts involve the following: Wills (similar wills made by husband and wife estate to survivor, residue to children) Relationship between joint tenancy and subsequent estate (here, issue involves severing tenancy to effect result that condo will go into estate) is severance testamentary in nature (and what does that mean?) can it, therefore, be effected through a power of attorney? Wills variation action (dependent on severance) Powers of attorney (involving questions of procedures around using powers of attorney to sever joint tenancy, when power of attorney is revoked by second p of a, fiduciary duties of attorney) Various lawyers are involved, contacted by different actors (who is the client?); action in negligence brought against one of them by wife Emotional family relationships What is a will: the fundamentals A will is what the law define it as (legal concept) An instrument, which disposes of the testator s property o Used to be possible to make an oral one (myths of time) o But this was changed historically o Instrument must be in writing as per WESA o Disposing of the testator s property (not just a normal disposal of property) o Who and what a testator is at law? Takes effect only on the testator s death Is revocable until the testator s death o So long as the testator is mentally capable of changing it (capacity) Made animus testandi (with valid intention to make the document in question next week we will explore this in more detail) o Capacity has several distinct components in this o Free from undue influence and mind must be free from insane delusions o If we are talking about a different type of instrument (not self identified as a will) then this question of what was intended make this more challenging to answer Must satisfy formal requirements (formalities) o WESA requirements 5

6 What does will: include? All valid unrevoked testamentary instruments If I make Will A, and subsequently make Will B, if Will B conflicts with Will A. Will B revokes Will A (If I am capable (capacity issues) of making will B, of course!) But if Will B does not conflict with Will A together they may constitute my will o They can coexist and work together (one single will) My will may also include codiciles, or documents amending wills What is in a will, contents A will should dispose of property (note, debts of the estate must be paid prior to bequests being dispersed according to the will) A will may appoint a guardian A power of appointment may be conferred by a will or exercised through it (ie. T s will says A to X for life, then X can be disposed of b A as she likes A might exercise this disposal in her will) o Not specifying what the future of the property is à basically makes fee simple in possession Appoints a personal representative (Executor) to administer the will if no executor names, a person can apply or the court may appoint one if needed for the distribution of the estate (WESA provides for the public Guardian and Trustee to be appointed for this purpose) o Only necessary for estates over a certain value Will may include other directions but they do not form a binding part of the will (regarding burial, choice of solicitor, eg) Dispersal cannot take place until probation has happened WESA requirements how to make a valid will 37 (1) To be valid, a will must be (a) in writing, (b) signed at its end by the willmaker, or the signature at the end must be acknowledged by the willmaker as his or hers, in the presence of 2 or more witnesses present at the same time, and (c) signed by 2 or more of the witnesses in the presence of the willmaker. (2) A will that does not comply with subsection (1) is invalid unless (a) the court orders it to be effective as a will under section 58 [court order curing deficiencies], (b) it is a will recognized as valid under section 80 [validity of wills made in accordance with other laws], or (c) it is valid under another provision of this Act. Fundamental concern, which is to give effect to the intentions of the testator Don t want to make the formal requirements too onerous to neglect to give effect to fundamental intentions If you made a will in England (which followed those rules) this will can be probated (proven to be valid) in a court in British Columbia Testamentary character/ nature of the will Refers to its taking effect only on death, and being revocable up to point of death (so long as T remains capable of revoking) until that point the will is ambulatory o It could be revoked à until death o There is case law around whether a will is ambulatory when someone loses the mental capacity to create a will i.e. someone had advanced dementia o But still the will doesn t take effect until death (not when capacity has been lost) Means that if I make a gift of Blackacre to X, with X taking possession on my death, the disposition is not testamentary (as the gift to X is vested in X, and is not revocable) o Different because the interest is vested o Testamentary powers would happen if you have the ability to change o POA and dispose of estate while the person is alive but ends on death 6

7 A mistake often made! Care agreements, eg o Kind of arrangements that older ppl get into with family members o Many people get into these agreements without getting adequate legal advice o Concern to keep the family home out of the estate (no probate fees, can t be used to settle debts) T therefore retains control over Blackacre up to the point of death ( Someday This Will All be Yours ) if he makes an inter vivos gift, he gives up that control T must have intended the will to execute his testamentary wishes (if I were to die in the next moment, this is the disposition I intend) Effect of marriage and separation Marriage does not revoke an earlier will (WESA) o Big change in the Act Divorce revokes gifts in a will now, so does separation (when one or both spouses terminate the relationship) (WESA), although right to division of family property under Family Law Act survives o Go back to the principle that we should give intention to the testator s wishes What interest does a beneficiary have? Remember, until death of T, T can change her will/ bequests, decide to sell Blackacre or give it away All beneficiary has is spes sucessionis, or expectancy This is not a vested interest although your text notes that courts have on occasion treated it as such, where T is no longer capable of changing her will (Weinstein v Weinstein) this is not the correct approach Will substitutes As we saw in the Houston case, individuals may use other means and methods to transfer property in place of testamentary dispositions in a will Advising clients about a will very often involves a discussion of these will substitutes and their implications, benefits and drawbacks, depending on the particularities of the situation Fact that rules applying to wills do not apply to these substitutes often perceived as a major plus! No need for probate, for example o There are benefits to avoid wills o But a testamentary disposition (doesn t matter what it calls itself) à property will go to the estate Gift inter vivos Must be intention to give absolutely while living (animus donandi) Gift to B on death of A may be considered a testamentary gift, and so subject to rules applying to wills (including rules re undue influence, for example, power of attorney, and most significantly whether property enters estate and is therefore subject to probate and debts of the estate) o Special rules around undue influence that are different between Gift intervivos and wills o POA rules are different, and whether the property is put into the estate It is undoubted law that whatever may be the form of a duly executed instrument, if the person executing it intends that it shall not take effect until after his death and it is dependent on his death for its vigour and effect, it is testamentary Cock v. Cooke (1866) Gift mortis causa is made in contemplation of donor s death, and takes place immediately although donor can revoke while alive (meaning gift not absolute) and recovery from peril will revoke o Strange old rule, not absolute, and it has to be immediate peril (if you don t die the gift is revoked) Remainder interest: T may convey Blackacre to himself for life (T has a life estate), remainder to A and B A and B then have vested remainder interests (meaning T cannot revoke them!) Intent determinative (as Cock v Cooke states) So if X transfers inter vivos gift of Blackacre to Y, but continues to treat Blackacre entirely as his own property with delivery only (if ever) upon death, gift may be treated as truly testamentary in nature Trust may avoid this problem X transfers Blackacre to W in trust for X for life, with remainder to X s children 7

8 Creation of trust not testamentary, because X has given up control of Blackacre interests not arising on death of X (X and children on death of X) The power to revoke (if A happens, return to X) does not make the trust testamentary title passed when the trust was created (even if it could be recalled); it does not pass on death of X o Practical outcome (reality) but then the abstract interests Joint interests: joint tenancy Encountered this in Houston v Houston question was whether the person holding power of attorney was entitled to sever the joint tenancy (which would have meant Blackacre passed to wife on T s death, without passing into estate), thereby ensuring that T s share of Blackacre did form part of T s estate, to be dispersed according to his will (benefitting children) o Right of survivorship wife gets it, and it does not go into the estate o If he seceded in severing it than Dr. H half of the property goes to the estate o The severance was successful o Favoured mode instead of will à especially when people don t have a lot of assets It may be however, where the joint tenancy has been created for convenience only, that the court will look behind it to find a resulting trust what happens in that event? o o Legal interest for someone else (it s a practical component in transferring) stops gaps in title Brings up the presumption of advancement: There is one exception that we assume ppl aren t giving away things for nothing, fathers (now includes mothers) will give gratuitously to their children Joint interests: joint bank account with right of survivorship (resulting trust and the presumption of advancement) Joint bank accounts (with right of survivorship): bank holds legal title; A (the depositor) and B (nondepositor) have a legal right to demand withdrawl; the survivor has the legal right (vested on opening account and so not testamentary) to withdraw the remaining balance of the death of the other But what are the equitable interests created between A and B (the beneficial entitlement to the funds)? Whether B takes a beneficial interest during the life of A depends on A s intention Equitable presumption of resulting of resulting trust presume that A does not intend to gratuitously to give money away, but intends to hold a resulting trust (retain beneficial interest) Exception presumption of advancement (presume that parents do intend to do this for their children); Pecore v Pecore altered the traditional rule by saying this presumption now applied to a gratuitous transfer to a minor child only (and not an adult) with no gender distinction So: a joint account is a will alternative, and donor can revoke it by withdrawing all funds (if nondonor account holder did this they would run foul of resulting trust) à with right of survivorship o o o o You have to know the implications of it Bank holds the legal title. A is the depositor. B is put on as a joint account holder. AB have a legal right to demand withdrawal. The survivor has the right to withdrawal the remaining balance on the death of the other. They vest immediately. What about the equitable interest? They are distributed otherwise. The depositor has the equitable interest à how does the resulting trust fit into this? Don t intend to give the beneficial interest but just to hold it in trust. Presumption of advancement: parents do give things gratuitously to their children. But Pecore v Pecore says this isn t the case because the modern use of this is to make things easier to manage elderly parents bills etc, and it keeps the money out of the estate o Presumption of advancement in this case is mostly for minor children not adults o It is useful to have a certain amount of money to cover the costs of death ie: solicitor fees, funeral costs The resulting trust protects the depositer à many don t know this Life insurance and benefit plans Also avoids the estate, thereby avoiding probate, going straight to the named beneficiary (or the beneficiary could also be the estate, or a trustee if you have a minor child, for example) 8

9 Avoiding the estate, and probate, one may also avoid creditors Benefit plans WESA, Part 5 Question of whether beneficiary designation is testamentary in nature has arisen (re rules applying to undue influence no, Turner Estate v Bezanson; re whether power of attorney can effect a change in designation yes, so he can t do it, Desharnatis v Toronto Domision Bank) o Is it a will in sheep s clothing? o Appointment a beneficiary is a testamentary act; something a POA cannot do Legislation Wills Estates & Succession Act, SBC 2009, c. 3, Part 4 Cases Moiny Estate (Re), 2001 BCCA 100 FACTS: Man died without a proper will. He had no survivors but had a distant aunt, who he was survived by. He had written a will in a military document that had bequeathed his estate to his friend. But the document was not entirely clear. ISSUE: Did the deceased die testate or intestate and, if the former, which instrument is his last will? And what does will mean? Is the wording dispositive? RATIO: Look to the overall wishes of the testator (Golden Rule) ANALYSIS: A will is a disposition or declaration by which the person making it provides for the distribution or administration of property after his death No survivors who can claim under the Wills Variation Act A surviving Aunt is entitled under the estate administration Act (If intestate) Golden rule: read a will to lead to a testacy not intestacy CONCLUSION: Appeal Dismissed. Wonnacott v. Loewen, 1990 FACTS: L is in a divorce and moves in with W. W dies à they have created an escrow agreement to provide for her in case of his death, it was done in a way to not meddle with her divorce settlement. Ws son believes the agreements were testamentary dispositions and invalid because of failure to comply with the Wills Act. ISSUE: Whether an agreement was a testamentary disposition and thereby invalid because of its failure to comply with the Wills Act RSB 1979, c. 434 RATIO: When the situation surrounding agreements look like a will but the testator has clear intentions in the immediate future for the property to pass, it is not a will. ANALYSIS: The escrow provision was machinery for carrying out the transfer for immediate joint tenancy To examine the transfer in isolation the document would be considered testamentary But within the context of the situation it makes Mr Wonnacott s intentions clear and within instruments that form a will She had the right to live there immediately He wasn t going to revoke it because of the fee of $60,000 penalty if it was revoked Bespoke à tailored made to fit your own idiosyncrasies 9

10 CONCLUSION: Appeal dismissed The WillMaker Age, Capacity, Intent Requirements derive from More general nature of a will as a transaction (so rules regarding capacity required to enter into binding transactions apply, in special way to wills) Ultimately, all about the ability to form a true, free intent to make will in question; intent requires the capacity, or mental ability, to form that intent, free from undue influence and insane delusions o Language can be a bit challenging here o Sometimes capacity is used in a broad sense or a narrow sense Age ultimately a question of mental capacity the age at which one is understood to have the capacity to make a will o Special aspects and rules that attach to it Exception: special rules about the armed forces o Contained in the legislation Looking at mental capacity in an omnibus category: o Confusing but a subcategory is mental capacity o Structure is similar to negligence (the breach is call negligence small n negligence, but the broader tort is Negligence o Any one of them, if established, will be fatal to the claim that they had the necessary capacity o In many cases all of these issues will be engaged (but not always à there is a relationship between them all) Cognitive capacity (simple ability to comprehend the nature of the effect of the will) Undue Influence à different and distinct, but can be factually related Insane Delusions à distinct sub category of mental capacity (specific rules are attached to this) o We must understand these as individual topics (different rules apply) but they are interrelated Relationship of will making capacity to probate In order to establish the validity of the will (the process known as probate), which will be necessary for the dispersal of assets according to the will, the will maker must have been capable of making that will with no impediment If you are an administrator and you want the will to go to probate do you have to show that they indeed had the capacity to make one? o No, it s a presumption that a willmaker had the necessary capacity The willmaker is (generally) presumed to have been capable (which means this does not need to be affirmatively established by the person seeking probate) if the will meets formal requirements, but his presumption can be challenged, or displaced through suspicious circumstances (discussed in more detail later) o The relationship between undue influence has some importance significance o Undue Influence floats around like a rogue o Vout v Hay o WESA has done some interesting things with it The onus is on the person proving the will (seeking to establish that the will is valid), and if the presumption is displaced, he or she must establish that the willmaker was capable of making the will with no impediment Issues relevant to intent (person proving may need to prove/ disprove): 10

11 Mental capacity (in this case, testamentary capacity, or the capacity to make a will) the lack of which may be referred to as general insanity. Can come about through multiple sources (disability, dementia, NOT mere age) refers to some cognitive state going to the ability to understand o Cognitive ability to comprehend the nature of the transaction o General insanity doesn t capture the nature of it The underlying condition itself is not determinative key question is the testator s ability to understand and appreciate this task o i.e. diagnosis of dementia does not mean that automatically they don t have the capability to write a will Insane delusions a particular condition that may affect a particular bequests (one may, generally speaking, be capable of making a will yet be affected by insane delusions that impair one s ability to form true intent) o When something s divorced from practical reality i.e. my son is the illegitimate child of Gene Simmons o Special insane delusion on specific request à then that part of the will is tainted, but the rest may be valid o The insane delusion has to effect the will (not just one that it out there) Undue influence may also vitiate the person s ability to exercise their free will o Important concept o Even if someone is mentally capable (have capacity and don t have delusion) o They may be subject to the influence of another, that the decisions they make cannot be seen as made freely on their own o Presumption: Certain categories of relationship we presume that it influences another Every gift given has happened as a result of influence Lawyer/ Client, Doctor/ Patient, Adult/ Child, Adult / Adult Child à not automatic but a special tenderness Class A (relationships that give rise on presumption) Class B relationships are ones that don t automatically give rise but depending on the circumstances of the case, they could SCC looked at these relationships came up with a phrase (Geffen v Goodman Estate) Relationships What would be a good way to displace the presumption? Independent legal advice, Mistake re contents or inability to know and appreciate the contents of a will (there one cannot be considered to have truly intent the contents) Knowledge and approval A person may be mentally capable of understanding the nature and effect of a will and its contents, yet under the circumstances not know or approve them The example given in your text (Russell v Fraser) concerns a testatrix who made a will (as the suggestion of her bank manager) leaving the residue of her estate to him Nobody (this includes the solicitor who prepared the will) discussed the magnitude of the residue with her, and there is no indication that she appreciated it (although had this been discussed and explained, there is no indication that she would have been incapable of understanding it) Therefore, while the rest of the will was valid, this clause was excised T was not capable of disposing of her residue is she did not know what it was! Mental capacity The requirement of mental capacity means that a person must be mentally capable of understanding and appreciating the content, nature, and effects of a will it is this relationship to the transaction in questions (making a will) that goes to the ability of a person to make a will, not his or her insanity per se In this sense the requirement of sufficient mental capacity to make a will is like the requirement of sufficient mental capacity in other contexts to sell land, enter a contract, get marries, separate or divorce o Will is the highest! Marriage is the lowest (traditionally) 11

12 o The hierarchy of capacity is a little old fashioned o Medical world does not like this it is Decisionspecific capacity The kind and quality (or degree ) of mental capacity required to do these things, respectively, depends on how complex they are Making a will traditionally required as among the most complex and, relatively, requires a high degree Mental capacity assessment Whether or not an individual possesses the required capacity is (often) not obvious not established by disorder alone (and so one may have a diagnosis of dementia and yet be capable of making a will) The lawyer the front line assessor important to satisfy yourself that a person making a will is mentally competent to do so (and if she is not, it is your responsibility to so advise); important to engage, take careful notes Medical evidence is persuasive, but not necessary, the question of capacity, so far as evidence based on observation and experience is concerned, may be answered as well by laymen of good sense as by doctors (Kournossoff Estate v Chapman 2000 BCSC 1195) o Lawyers, notaries, ppl around the testator who knew them well Relevant date is date if instruction may be different from execution/ signing ( so long as T knows this is his will, and that he is executing it) o Important to engage the client, about what their estate is, what beneficiaries and why?, are there any not included o If the client is brought by a family member that is bound to gain by a change o Assessment is important by a doctor o It helps if you have a good relationship with your client Ask questions that relate to the will, family, relationships etc What must be understood (requiring mental capacity to so understand) Banks v Goodfellow an understanding of the nature of the business [willmaking] in which he is engaged, a recollection of the property he means to dispose of [need not be precise], the persons who are the object of his bounty [the extent of what he is giving to each beneficiary and the nature of the claims of others whom he is excluding], and the manner in which it is to be distributed between them. It is not necessary that he should view his will with the eye of a lawyer, and comprehend its provisions in legal form. It is sufficient if he has such a mind and a memory as will enable him to understand the elements of which is it composed, and the disposition of his property in its simple forms Insane delusions distinguished Banks v Goodfellow It is essential that a testator shall understand the nature of the act and its effects; shall understand the extent of the property of which he is disposing, shall be able to understand and comprehend the claims to which he ought to give effect [mental capacity]: and with a view to the latter object, that no disorder of the mind shall poison his affections, pervert his sense of right, or present the exercise of his natural faculties that no insane delusion shall influence his will in disposing of his property and bring about a disposal of it which, if the mind had been sound, would not have been made. [insane delusion] Human instincts and affections may become perverted by mental disease but also insane suspicion or aversion insane delusion relevant only to extent that it affects a particular disposition I.E. my son only does nice things because he is motivated by getting my money. What happens when this has no bearing on reality, and it isn t connected to any mental illness. Insane delusions Belief in a state of facts which are not true may be held despite fact that T is generally sane (has mental capacity to understand the nature and content of her will) Only if the delusion affects the dispositions made in the will it invalidate the will, or a portion of it (the portion affected by the delusion); so in Banks v Goodfellow, T suffered from insane delusions about being persecuted by 12

13 Featherstone Alexander and demons, but his will left his property to a niece who lived with him, and of whom he was evidently very fond the will was therefore rational (Sounds, apparent reasons existed for it) and untainted by his peculiar delusions Suspicious circumstances and the burden of proof Remember, the onus of poving that the will is good and valid (and that therefore distribution according to the will can take place) is on the person proving the will (the executor, the person administering the will) However, ordinarily (absent suspicious circumstances ), remember the presumption that if the will complies with formal requirements the will maker was competent to make it (and the will can be probated without a trial) suspicious circumstances spend or displace that presumption If a party raises a genuine issue about capacity, insane delusions, or undue influence [referred to in your text with general term capacity ], or if the circumstances suggest a lack of omnibus capacity or another problem such as lack of knowledge about the contents of the will, capacity must be proved at trial Issue must be genuine and on an application that a will be proved in solemn form (at trial) the application judge can dismiss it for lack of a triable issue and give summary judgment (where there is ample evidence of capacity and no credible evidence of undue influence); or judge might grant the application because there is a triable issue Suspicious circumstances do not create a general miasma of suspicion that something unsavoury may have occurred, but [are] rather circumstances which create a specific and founded suspicion that the testator may not have known and approved of the contents of the will May be circumstances surrounding preparation of the will May be circumstances calling into question the capacity of T to make the will Or, may be circumstances suggesting that the free will of T to make the will was overborne (undue influence) Barry v Butlin suspicious circumstances = solicitor preparing the will a beneficiary under it (1/4 of estate); residue to his friend Mr B, sole executor; son took nothing. If, as here, a party writes or prepares a will under which he takes a benefit that is a circumstance that ought generally to excite the suspicion of the Court but that suspicion may be satisfied, as here, by evidence of capacity and lack of insane delusions or undue influence Undue Influence has to be proved by the person asserting it. Traditional rule that those attacking the will on the basis of undue influence must prove it (as opposed to propounder proving, but having benefit of a presumption of capacity in absence of suspicious circumstances) Undue influence an equitable doctrine that the will of T (or a donor, in other circumstances) was overborne by another such that the decision in question was not, truly and freely, his own; factually, issues of mental capacity, undue influence, and knowledge are often intertwined (a factor relevant to one will be relevant to another) Two species of undue influence actual and presumed (in relationships giving rise to a presumption of undue influence); two species of presumed (some relationships always give rise to a presumption; in others, the dynamics of the particular relationship give rise to the presumption) Always actual undue influence (never presumed, unlike gift inter vivos) If the onus was on the executor to disprove undue influence, in a way it would create a presumed undue influence this is one of the problems and why the person arguing undue influence must affirmatively prove it how does this related to suspicious circumstances and their general effect on the burden of proof? How does the traditional rule re undue influence interact with the doctrine of suspicious circumstances? Do suspicious circumstances work to require the propounder of the will to establish that the will was freely made without undue influence? Undue influence does not put the onus onto the executor to disprove but because of the traditionally rule the person who charges undue influence has to prove it Suspicious circumstance and the burden of proof: undue influence No Vout v Hay says the traditional rule is firmly entrenched that undue influence must be raised and proved by the attacker, and there it remains; how does this relate to the presumption of undue influence? Vout (the executor) does not need to disprove undue influence Hay must prove it 13

14 The trial judge failed to deal properly with the effect of suspicious circumstances, but he did carefully consider the evidence and conclude that T was capable, and made the will he wanted to, without undue influence from V Consider Banton v Banton, page 228 S. 52 WESA Fraud and mistake Fraud if T was induced to make the will through fraud, it is void (goes to true and free intent) Mistake a provision is not valid if made by mistake (going to T s knowledge and approval of the contents of a will In the following categories of mistake: o Where there is a patent mistake (T made an error about an existing fact and relied on that mistaken belief) on the face of the will, and o Where a drafting error has occurred (court will exercise its jurisdiction to strike out words wrongly inserted o Where the testator executed the wrong document (ie Husband/ wife signing each other s wills) S. 59 WESA Rectification of will o Gives the will life! Legislation: Wills Estates & Succession Act, s. 36 Who can make a will 36 (1) A person who is 16 years of age or older and who is mentally capable of doing so may make a will. (2) A will made by a person under 16 years of age is not valid. *WESA lowered the age requirement Exception (age) 38 (1) A member of the Canadian Forces while placed on active service under the National Defence Act (Canada), or a member of the naval, land or air force of any member of the British Commonwealth of Nations or any ally of Canada while on active service may, regardless of his or her age, make a gift of property by will in writing, signed by the will- maker at its end or by some other person in the presence of and by the direction of the willmaker. (2) If the will is signed by the willmaker, there is no need for a witness to be present to witness or to sign the will as a witness. (3) If the will is signed by another person, the signature of that other person must be witnessed by the signature of at least one person, who must sign the will in the presence of the willmaker and of that other person. WESA alters the traditional rule re the presumption of undue influence! Introducing a statutory presumption of undue influence Undue influence 52 In a proceeding, if a person claims that a will or any provision of it resulted from another person (a) being in a position where the potential for dependence or domination of the willmaker was present, and (b) using that position to unduly influence the willmaker to make the will or the provision of it that is challenged, 14

15 and establishes that the other person was in a position where the potential for dependence or domination of the will- maker was present, the party seeking to defend the will or the provision of it that is challenged or to uphold the gift has the onus of establishing that the person in the position where the potential for dependence or domination of the will- maker was present did not exercise undue influence over the willmaker with respect to the will or the provision of it that is challenged. Rectification of will 59 (1) On application for rectification of a will, the court, sitting as a court of construction or as a court of probate, may order that the will be rectified if the court determines that the will fails to carry out the willmaker's intentions because of (a) an error arising from an accidental slip or omission, (b) a misunderstanding of the willmaker's instructions, or (c) a failure to carry out the willmaker's instructions. (2) Extrinsic evidence, including evidence of the willmaker's intent, is admissible to prove the existence of a circumstance described in subsection (1). (3) An application for rectification of a will must be made no later than 180 days from the date the representation grant is issued unless the court grants leave to make an application after that date. (4) If the court grants leave to make an application for rectification of a will after 180 days from the date the representation grant is issued, a personal representative who distributes any part of the estate to which entitlement is subsequently affected by rectification is not liable if, in reasonable reliance on the will, the distribution is made (a) after 180 days from the date the representation grant is issued, and (b) before the notice of the application for rectification is delivered to the personal representative. (5) Subsection (4) does not affect the right of any person to recover from a beneficiary any part of the estate distributed in the circumstances described in that subsection. Cases: Legier v Poirier FACTS: Hector moves in and keeps his mom under watch/confinement. Only access to her was through him. Testimony of the grandniece showed the diminished capacity of the WM, and the circumstances that led to will will made specific bequests and residue to the son 1939 will made specific bequests to son and others; residue to granddaughter In 1935/ 36 T had conveyed land to son T s grandchildren assert that the 1941 will is invalid because T was not competent, at the time, to make it ISSUES: Whether or not she had capacity in the 1941 will? DECSIONS: She did not have capacity APPLICATION Practice Point 15

16 Explain Why (if the client wants to do something outside of the regular expectations of a will or has special distributions) In the Will In a letter (ensure that the letter is signed by the client or it will be tossed. Make sure that clients know this) In a statutory Declaration In these circumstance, the onus of showing the document as the will of a free and capable person had not been meet What matters is T s ability to understand the essential elements of will making Mrs. P may have been able to converse rationally, but the competency of the mind must be judged of by the nature of the act to be done, and from a consideration of all the circumstances of the case. So T may have been able to provide the date and name the Prime Minister of Canada, but this is not sufficient evidence of her capability of understanding the subject in question her will, and the disposition of property set out in it Re Davis (197) is T s last will valid? Why/why not? What evidence does the court consider relevant to this question? What is the basis for the outcome in this case? o Widow had a conditioned that changed her personality and changed her will to leave everything to a nonexistent society o It was dismissed as being invalid because she was found to not be competent o There are a lot of facts that are irrelevant to the will Sharp v Adam ISSUE: Mental capacity/ability to understand or insane delusions affecting dispositions so as to alter dispositions that would be made in the absence of those delusions? *Insane delusions need not have a cognitive basis (sometimes they do, but it is not necessary), bizarre suspicious ANALYSIS: The act that a testator excluded someone who they would normally not exclude is not an insane moment, as long as there are valid reasons for exclusion there is no issue The trial judge thought it likely that there was a temporary poisoning of the testator s natural affection for his daughters, or a perversion of his sense of right in our view, the 4 th element in Banks v Goodfellow poison his affections, pervert his sense of right or pervert the exercise of his natural faculties, no insane delusions is as much concerned with mood as with cognition goes to qualitative distinction between insane delusions and general question of mental capacity ( general insanity ) Note Kurtz and Nicholson solicitor took great care in establishing (general capacity), noting that son excluded, and taking great care to ensure that he discuss (valid) reasons for this exclusion with T O Neil v Royal Trust Co FACTS: Final change to will made at a time when T confined to a sanitarium, having suffered what appears to be a nervous breakdown (she believed she could smell gas and feared her food was being poisoned, and experienced periodic hallucinations and delusions) She was declared mentally incapable of managing her property However, the solicitor preparing this last will appears to have been careful, and questioned T about her property and previous wills, and reasons for change; T s psychiatrist also believed her capable of making a will The evidence comes together Lawyer went to great pains to show that she was capable The possession of [the delusions and hallucinations possessed by T] do not invalidate a will unless they have brought about the will or constituted an actual and impelling influence in the making thereof ; it is [also] 16